It was established on June 7, 1984 by Bureau of Alcohol, Tobacco and Firearms (ATF), Treasury after reviewing the petition submitted by three of the grape-growers and winery owners located in an area surrounding the watershed of Clear Lake in southwestern Lake County.

The petition requested the viticultural area to be named "Clear Lake.

"[1] Half of the area contained within the viticultural area boundaries is Clear Lake, the largest body of freshwater in the state of California, and the namesake for the county.

The moderating influence of the lake on the surrounding area results in a climate with less diurnal variation in temperature than surrounding areas.

[1][4] Clear Lake AVA is one of the coolest climates in California, which has led to success with grape varietals like Sauvignon blanc.